Federal cabinet decides on significantly higher social contributions for high earners

High earners will have to prepare for significantly higher social security contributions in 2027. On Wednesday, the Federal Cabinet approved the Ministry of Labor's annual regulation to increase the salary limits up to which social contributions are deducted. The contribution assessment limit for statutory health insurance increases from 5,812.50 to ⁠6,375 euros per month. In pension and unemployment insurance it will be increased from 8,450 to ‌8,850 euros.

For an employee with an income above these limits, this results in an additional monthly burden of almost 102 euros, assuming otherwise the same contribution rates.

However, social contributions increase significantly for high earners. For a legally insured employee with a child who will continue to earn above the new limits in 2027, if the contribution rates remain unchanged, this will result in an additional burden of just under 102 euros per month or a good 1220 euros per year. This assumes an additional contribution from the health insurance companies of 2.9 percent. The employer is also usually charged an additional ⁠102 euros per month. Employees and employers together pay around 203 euros more per month.

This takes into account that the contribution limit for nursing care insurance should also rise to 6,375 euros. The cabinet had already decided this at the end of September with the draft of the Care Reorganization Act (PNOG). This means that the additional increase of 300 euros per month planned for health insurance will also be reflected in nursing care insurance. However, the PNOG still has to be approved by the Bundestag.

For those without children, the PNOG entails a higher contribution burden for all employees. The surcharge for long-term care insurance that they alone have to bear increases from 0.6 to 0.9 percentage points at the turn of the year. If your income exceeds all contribution limits, your total additional burden compared to 2026 would rise to around 124 euros per month.

The contribution limits are adjusted annually to salary developments in accordance with legal requirements. ⁠For 2027, the increase in gross wages and salaries per employee by 4.38 percent in 2025 is decisive. This time, however, the contribution assessment limit and the compulsory insurance limit in health insurance will be increased beyond the wage development in order to fill financing gaps. The same applies to nursing care insurance.